Forex traders said the weakness in the rupee was largely due to strengthening of the US Dollar against a basket of currencies as investors fled to safe haven greenback amid weakening risk appetite in the markets.
At the interbank foreign exchange, the rupee opened weak at 76.75, and during the day lost further ground to settle at 76.87, registering a fall of 43 paise over its previous close.
During the session, the rupee moved between 76.68 and a low of 76.87 against the US dollar.
On Wednesday, the rupee had settled at 76.44 against the greenback.
Besides, investor sentiments remain fragile amid concerns over the impact of coronavirus outbreak on the domestic as well as global economy.
The number of cases around the world linked to the new coronavirus has crossed over 20 lakh. In India, over 12,000 coronavirus cases have been reported so far.
Brent crude futures, the global oil benchmark, rose 1.17 per cent to USD 28.18 per barrel.
Foreign institutional investors (FIIs) were net buyers in the capital markets, as they bought shares worth Rs 1,358.66 crore on Wednesday, as per provisional data.
Domestic bourses were trading on a positive note with benchmark indices Sensex trading 334.06 points higher at 30,713.87 and Nifty up by 90.25 points at 9,015.55.
The dollar index, which gauges the greenback's strength against a basket of six currencies, rose by 0.29 per cent to 99.75.